S&P Global upgrades Pakistan’s credit rating

ISLAMABAD: Pakistan’s economy has witnessed a positive change, as S&P Global has upgraded Pakistan’s credit rating, reestablishing confidence in the economic trajectory of the country.

This major development will enhance investor confidence in Pakistan’s economic direction.

Pakistan’s sovereign credit rating has been upgraded by S&P Global Ratings from CCC+ to B- with a stable outlook. The upgrade is the reason behind improved fiscal conditions, increasing foreign reserves, and assistance from the International Monetary Fund (IMF).

The upgrade by Fitch Ratings earlier this year also lifted Pakistan’s credit rating to B- from CCC+, which made it the first improvement of this sort in the past six years.

The offers reflect the improvements in macroeconomic policy reforms of Pakistan, that is, inflation management, revenue collection, and fiscal discipline.

Pakistan’s foreign exchange reserves have jumped to $20.5 billion, down from an all-time low of $6.7 billion in December 2022, according to S&P Global. The IMF’s $7bn extended financial support and a $1.3 billion flexibility have been the key factors in stabilizing the economy.

IMF officials complimented Pakistan’s “strong program implementation,” which reflected a primary surplus of 2.0% of GDP and inflation falling to record lows.

Business sentiment is increasing. PwC observed that CEOs’ optimism jumped from 49% to 85%, while the OICCI Business Confidence Index rose from 5% to 11%10.

Gallup Pakistan observed that these results are signs of a good economic path.

These advancements show that Pakistan’s credit rating enhancements are not one-off events but an element of a larger economic revival.

With ongoing enhancements and international support, Pakistan’s credit rating can continue to improve, leading the way for more investment and sustainable development.

Pakistan’s Economy Top Priority

Earlier, in regard to Pakistan’s economy, Prime Minister (PM) Shehbaz Sharif added that the government’s top priority is economic transparency through a digitisation system.

Chairing the weekly meeting for a cashless and digital economy, PM Shehbaz explained that digitalising the payment process between the government and citizens would improve transparency and convenience for the users.